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Nursery FACTSHEET

July 2015

Starting a Nursery Business in B.C.

INTRODUCTION TO STARTING A NURSERY

A nursery business offers the opportunity for a financially and personally rewarding business

venture for the dedicated owner who has a sound business plan. The sector is attractive to new

growers due to the small land base and minimal capital investment; however, a wide range of

knowledge is required and, there are many things to be considered before investing in a nursery

operation.

This booklet is intended to assist a new grower in making the decision of whether or not to enter

the nursery sector. The publication gives an overview of the sector, discusses points that should

be considered before starting a nursery, and offers other valuable sources of information.

THE B.C. NURSERY SECTOR

B.C. is the second largest producer of

nursery stock in Canada and accounts for

30% of the national nursery trade1. The

major production areas are concentrated on

Vancouver Island, and in the Kootenay,

Lower Mainland, and Okanagan regions.

These areas enjoy some of the lowest

production costs in Canada because of

minimal over-wintering requirements,

maximum growing season length, and the

availability of abundant supplies of good-

quality water.

B.C. nursery businesses range in size from

small, one-person operations to highly

mechanized facilities with hundreds of acres

of field stock, outdoor container beds, and/or

greenhouse facilities. In 2014, there was

3,500 hectares of nursery production area in

the province. Seventy per cent of the area

was used to produce field-grown plants and

1 CANSIM tables, Statistics Canada

thirty per cent was used to produce

containerized plants.

Nursery crops include a diverse range of

several thousand genera of ornamental plants.

They range from herbaceous garden flowers,

vines and grasses, to woody trees and shrubs,

both deciduous and coniferous. Growers may

propagate their plants from stock plant material

or purchase “liners” from other nurseries to

grow on and resell. A liner is a young plant

that needs to be grown for one or more seasons

in the nursery to reach a saleable size.

Annual sales for the sector have been relatively

stable since 2010 (Figure 1). Most nurseries

sell solely to the wholesale market, while

others may specialize in the retail market, or

have both retail and wholesale divisions. The

major wholesale buyers are mass

merchandisers (27%), independent garden

centres (23%) and landscape contractors

(24%)2. Mass merchandisers are an

2 CANSIM tables, Statistics Canada

increasingly important market for nursery

stock. In the past 10 years, sales to mass

merchandisers have more than doubled3.

Figure 1. Annual gross sales for the B.C.

nursery industry4.

The B.C. nursery sector sells products across

Canada, but Alberta and Ontario are the

most important domestic markets outside

B.C. The sector also exports product into

the U.S. U.S. export sales increased rapidly

between 1998 and 2002, showing a 122%

growth rate4. The U.S. is the world’s largest

consumer and producer of nursery products,

and has the potential to be a lucrative and

growing market for Canadian nursery

products. Canada’s proximity to the U.S.

and a favourable currency exchange placed

Canadian nursery growers in a strong

position to take advantage of this

opportunity in the mid 1990’s. This

advantage eroded in 2003 as the value of the

Canadian dollar began to appreciate.

However, the recent depreciation of the

Canadian dollar is leading to a gradual

increase of nursery exports to the U.S. It is

no secret that the exchange rate influences

the ability of Canadian exporters to access

the U.S. market.

3 CANSIM tables, Statistics Canada 4 Trade Data, Statistics Canada

CONSIDERATIONS FOR NEW

NURSERY GROWERS

There are many points to consider when

looking at starting a nursery, such as:

personal aptitude,

crop marketing,

site selection,

site design and layout,

developing a business plan, and

crop selection.

Each of these points is covered in the following

sections.

PERSONAL APTITUDE

Becoming a successful nursery operator

requires more than a love for gardening. To be

successful, a nursery operator must possess a

high level of commitment and have a broad

range of skills. In order to reduce expenses, it

is beneficial for the operator to be able to

perform all, or most, of the work required in the

day-to-day operation of the business. The

skills required to operate a nursery include:

technical trade skills, such as plumbing,

electrical, carpentry, welding, and

mechanics;

knowledge in crop production, including

plant growth and development, soils, plant

nutrition, and pest management;

business skills, such as record keeping,

inventory control, business and personnel

management, marketing, and accounting;

and

the ability to cope with adversity is

invaluable, since adversity is inevitable.

Adversity will arise in the form of weather

or pest-related crop problems, equipment

breakdowns, staff problems, and poor sales

and cash flow.

The more of these skills an operator has, the

better their chance of success. However, do not

be discouraged if you do not possess all the

skills listed, since they can be learned from

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courses offered by local educational

institutions. There are numerous 1-day

nursery seminars offered during the year that

may be of particular interest to new growers.

Information on these events is available

through the B.C. Landscape and Nursery

Association (BCLNA).

As the nursery grows in size, there will be

the opportunity to hire staff with specialized

skills. Until that day, the nursery operator

will truly need to be a “Jack-of-all-trades”.

MARKETING

Marketing is the single most difficult aspect

of nursery crop production and should be

considered well ahead of growing any

plants. Unlike many other agricultural

commodities, there is no centralized selling

agency, such as a marketing board or a

nursery plant auction. A nursery operator is

on their own when it comes to product

marketing. This is further complicated

today because each nursery has to compete

in the highly competitive North American

marketplace.

There are many factors to consider when it

comes to marketing. What marketing

channels will work best for your situation,

and what type of marketing and promotional

tools will you use? What will be your

market area? Will it include local, domestic

or export markets? Shipping product

outside your local community increases

market size, but it also brings with it the

need to know and adhere to regulations

designed to prevent the movement of

quarantine pests. Further information about

these regulations is presented in Appendix 1,

and in Chapter 2 of the Nursery Production

Guide. In addition, you will most likely

have to rely on a commercial trucking firm

to transport your product into distant

markets. Today, due to high fuel costs and a

shortage of trucking companies, it can be

difficult for nurseries to secure their trucking

needs.

A 2002 survey of B.C. nursery operations

determined the main marketing tools used

by wholesale nurseries differ from those used

by retailers5. Wholesale nurseries spend an

average of 2% of their sales on their marketing,

advertising and promotion budget. Larger

firms spend a smaller percentage of sales on

marketing than small firms. The main

promotional tools used are trade shows (25% of

budget), product catalogues (21%), and buyers

guides (16%). Other forms of promotion

include: Yellow Pages (3%), trade journals

(8%), newspapers (3%), web site (7%) and

sponsorship of industry events (4%).

In contrast, the retail nurseries surveyed spent

an average of 4.2% of their sales on their

marketing, advertising and promotion budget6.

The main promotional tools used are

newspaper advertisements (40% of budget),

direct mailers/newsletters (15%), flyers (12%),

radio advertisements (10%) and sponsorship of

community events (7%). Other marketing

methods used are: television (5%) and in-store

clinics (1%).

Marketing Channels - Wholesale versus

Retail: There are many markets for nursery

crops, including landscape contractors, garden

centres, mass merchandisers, other growers,

brokers, agricultural producers (e.g. tree fruit,

berry growers), and homeowners.

Most nursery crops are sold at the wholesale

level. The major wholesale markets are mass

merchandisers and retail garden centres, which

accounted for 27% and 23%, respectively, of

gross farm gate sales in 2014. Other markets

include other growers (16%) and landscapers

(24%)7. The landscape sector is a growing

market for nurseries as homeowners

increasingly prefer to hire a landscaper to build

and maintain their garden rather than do it

themselves. This is occurring because

homeowners have less time and interest to

work in the garden today.

5 The Nursery and Landscape Industry in British Columbia.

2002. BC Landscape & Nursery Association. 6 The Nursery and Landscape Industry in British Columbia.

2002. BC Landscape & Nursery Association. 7 CANSIM tables, Statistics Canada

Figure 2. A shipment of nursery stock almost

ready for delivery. Pots are carefully stacked to

maximize the units of product per load.

Figure 3. Some nurseries ship stock on pallets

to simplify loading and unloading.

Brokering is a small but useful market

channel for new growers that have a limited

product line, insufficient market contacts,

and/or poor marketing skills. Brokers enter

into agreements with growers to market and

sell their product for an agreed upon price.

Nurseries that broker product are identified

in the BCLNA’s Buyers Guide, which is

available on their website.

Nurseries routinely buy stock from other

nurseries to fill orders. This market

channel cannot be relied upon to move stock

because sales only occur on an ‘as required

basis’. To be considered as a potential

supplier to other nurseries, it is critical that

you are known within the sector. To

establish a presence in the sector, it is

important to belong to the BCLNA and to

participate in industry events and

committees. The value of active

participation in the Association cannot be

overstated.

Direct selling of product to the consumer is

attractive because it maximizes price per plant.

However, the costs associated with selling the

crop are higher. Some drawbacks of direct

selling are sales occur at the busiest time in the

nursery production cycle and retail customers

can demand a lot of time. In fact, almost 25%

of people have no intention of making a

purchase when they visit a garden centre, but

instead their intentions are to browse or gather

information8.

A 1999 consumer survey completed in B.C.

found that garden centres are the prime source

of gardening information for 81% of

respondents9. Books (12%), mass

merchandisers (6%), and super markets (1%)

are used infrequently. Customer service is

extremely important when retailing. Anyone

planning to venture into retailing should be

people-oriented.

Direct farm marketing businesses must

follow many laws and regulations. For

instance, some regions have enacted laws that

require direct farm markets to have:

a building permit to ensure compliance

with building codes,

a business license or registration,

liability insurance,

product, fire, and/or theft insurance, and

signs that meet standards with respect to

placement, size, location, and type of sign

used.

Regulations can vary between municipalities.

Assistance with establishing an on-farm retail

business can be obtained from your regional

direct farm marketing association. Registration

for many required licences, as well as business

name, export and GST numbers are available

on-line from the Canada Revenue Agency.

8 Jim Van Dellen, “Advertising Analysis”. American Nurseryman, November 15, 1998, pages 50-54. 9 B. McTavish and J. Jarvis. British Columbia Garden Products

and Services Consumer Survey. February 1999. BC Landscape & Nursery Association.

Mail-order selling is another form of

retailing. However, it does not require face-

to-face business with the client. Keys to

success are the quality of your catalogue and

your ability to maintain plant health and

vigor during shipping. Obviously the latter

point will depend upon the type of plant

material, the packaging system, and the type

of carrier used. An excellent reference on

mail-order selling is “So, You Want to Start

A Mail Order Nursery” by Tony Avent,

Plant Delights Nursery.

Internet websites can bring the world

marketplace to the door of even the smallest

nursery business at a reasonable cost. You

may register a web domain by conducting an

Internet search for web domain registration

companies. Professional website design

consultants will create a site that effectively

showcases your nursery’s products.

If you have mail-order or Internet sales

outside of Canada, there are costs to meet

export requirements. These include

Canadian Food Inspection Agency

inspection fees to issue a phytosanitary

certificate and broker fees to prepare the

necessary documentation for U.S. Customs.

It is important to look into these issues

before starting a mail-order business or

Internet marketing program. Your Internet

site will be accessible worldwide and,

therefore, you must ensure you have the

right to sell each plant to all countries.

Internet businesses have been sued for

infringing on license agreements.

Product Quality - The #1 Criteria used to

Select a Supplier: Crop returns are directly

related to crop yield. An increase in crop

yield (a reduction in shrinkage) will increase

crop returns. Of course, the reverse is also

true: a reduction in crop yield will decrease

crop returns. A grower must realize and

take into account that not every plant grown

will develop into a marketable plant. Based

on a 2002 sector survey, on average 6.8% of

a crop is discarded due to poor health

(2.2%), poor sales (1.2%), spoilage (2.5%),

and other reasons (0.9%)10

. The quantity of

stock discarded each year due to spoilage was

reported to range from 0% to 30%11

. The level

of crop losses can be the difference between a

profitable and a non-profitable year.

To maximize crop returns and to meet orders,

there is incentive to ship product of lesser

quality. Growers may feel they can

compensate a client for accepting low quality

stock by shipping extra plants or by offering a

price discount. The potential drawbacks of

shipping low quality plants include:

Nursery clients may struggle to grow the

plants to a marketable size in the scheduled

production period, which will disrupt their

future supply of the crop.

Retail clients will receive lower returns per

plant and may find it more difficult to sell

low quality plants.

Landscape clients will run into several

potential problems associated with the

receipt of inferior plants, including client

dissatisfaction and increased risk of poor

plant establishment and the need to replace

material in the landscape.

The end result of shipping inferior plants may

be the loss of a client or refund requests to

compensate for plant losses.

Sector surveys suggest that price is not one of

the major criteria used by retailers and

landscapers to select a nursery as a supplier.

Instead, plant quality is the most important

criterion12

. Plant quality incorporates plant

health and appearance, and the quality of

packaging materials. The level of personal

service, consistency of supply, and speed of

delivery are all more important criteria to

garden centres than price13

.

10

The Nursery and Landscape Industry in British Columbia.

2002. BC Landscape & Nursery Association. 11


2002. BC Landscape & Nursery Association. 12 M.P. Garber and K. Bondari, "Retail Garden Outlets: Plant

Material Purchases and Trends." Journal of Environmental Horticulture, 16(1):20-26. March 1998. 13 M.P. Garber and K. Bondari, "Retail Garden Outlets: Plant

Material Purchases and Trends." Journal of Environmental Horticulture, 16(1):20-26. March 1998.

Today, the sector is more aware that high

quality packaging materials increase retail

sales. For this reason, the traditional black

nursery container is being replaced by a

multitude of different colored pots, and plant

labels are being improved with color

pictures and more extensive information

about the plant. The use of bigger and more

colorful and informative tags is a trend14

.

Retailers also look for point-of-sale

merchandising materials from growers,

including end-of-aisle displays, brochures,

banners and posters. A number of

individual nurseries, regional governments

and commodity associations have developed

nursery and landscape standards. In B.C.,

the BCLNA and the B.C. Society of

Landscape Architects jointly developed the

B.C. Landscape Standard15

, which sets

standards for nursery plants and landscape

installations.

The B.C. Landscape Standard: This

section provides an overview of some

aspects of plant grading presented in the

B.C. Landscape Standard. Growers are

encouraged to review the full Standard for

more details on plant grading.

The Standard establishes minimum root and

plant size relationships for nursery stock.

Root size is equal to the container or root

ball size. Above-ground growth is measured

by trunk caliper (for standard shade trees

over 2.5 m tall), plant height (conifers and

standard shade trees up to 2.5 m tall),

canopy density and shape (height and spread

ratio), or canopy density and plant spread

(for spreading evergreens and dwarf

conifers). Figure 4 provides an example of

the Standard on canopy proportion and

density for coniferous evergreens.

The root ball or potting medium should have

roots extending throughout it, without being

root bound, and should be firm and intact.

14 J. Bramwell and B. Grabarek, “Trendy Tags.” American

Nurseryman, August 15, 2005, pages 35-39. 15 BC Landscape Standard, 2001 (6th edition). Published by

the BC Society of Landscape Architects and the BC

Landscape & Nursery Association.

Containers should be filled to within 2.5 cm of

the top of the container. For balled stock, the

root ball should have an adequate fibrous root

system that has been developed by proper

cultivation practices. The root ball should be

secured tightly with burlap and twine.

Figure 4. System for Grading Nursery Stock -

Example: Tall and Broad Coniferous Evergreens

(adapted from the B.C. Landscape Standard16

).

The Standard also addresses ethical issues of

wild plant collections, presence of noxious

perennial weeds, and plant substitutions.

The Standard is intended to achieve the

following goals:

to standardize the products growers

produce,

to simplify the bidding process for

landscape contracts, and

to ensure proper root growth and pruning to

produce a healthy, well-developed plant.

The BCLNA continues to encourage the sector

to adopt the Standard. In time, as acceptance of

landscape standards increases, the market for

lesser quality plants will disappear.

16

BC Landscape Standard, 2001 (6th edition). Published by the

BC Society of Landscape Architects and the BC Landscape & Nursery Association.

POINTS TO CONSIDER WHEN

SELECTING A SITE

Most new growers have a farm prior to

selecting a crop to produce. This may

restrict what ventures can be developed at

the site. Five points to consider when

evaluating the suitability of a site for nursery

production are discussed below.

Parcel Size: Nurseries come in all shapes

and sizes. Retail production nurseries are

commonly less than 10 hectares. Wholesale

production nurseries vary tremendously in

size, and range from less than one hectare to

hundreds of hectares. The size of the

operation is strongly influenced by the

relative amounts of container and field stock

produced. For nurseries in B.C., the average

area of container production is 5 hectares

and of field production is 30 hectares17

. An

allowance for future expansion should be

taken into consideration.

Location: Proximity to hydro, phone lines,

service roads, labour supply, and, if you

choose to direct-market from the farm,

proximity to a large population base is

important. Approximately 83% of a garden

centre’s customers are drawn from an 8-24

km radius18

. A recent U.S. survey found

consumers to rate store location more than

twice as important as plant quality, plant

selection, and customer service19

. Store

location was the #1 consideration for repeat

customers20

. However, a similar survey

conducted in B.C. found only 1.5% of

respondents to rate proximity to a retailer as

an important factor in their buying

decision21

.

History of the Site: Becoming informed

about previous uses of the site may uncover

17


2002. BC Landscape & Nursery Association. 18 D. Ference and Associates. Profile of the BC Nursery

Industry. April 1991. BC Nursery Trades Association. 19 Jim Van Dellen, “Advertising Analysis”. American

Nurseryman. November 15, 1998, pages 50-54. 20 Jim Van Dellen, “Advertising Analysis”. American Nurseryman. November 15, 1998, pages 50-54. 21 B. McTavish and J. Jarvis. British Columbia Garden

Products and Services Consumer Survey, February 1999. BC Landscape & Nursery Association.

potential problems before committing to the

capital outlay of developing and stocking the

site. Valuable information to gather includes

previous crops, contamination problems,

underground structures, drainage history and

location, and condition of subsurface drainage

installations.

Soil Requirements: The site should have a

slight slope, have no frost pockets, and be well

drained. Drainage systems, including pumps

for very low areas, must be installed before

planting. Additional soil requirements that

apply for field-grown stock include:

good soil structure and free of stones,

a loam top-soil of at least 60 cm depth; clay

loam is required for the production of

balled stock, whereas sandy loam is best

for bareroot production,

freedom from serious pests or pesticide

residues that may be injurious to newly-

planted stock, and

a pH of 5.0-7.2, however, if the pH is

outside this range it can be corrected.

Contracting soil surveys and testing can help to

determine quality, character and usefulness of

the site. There are several soil test labs in B.C.

These labs can analyze soil for crop nutritional

requirements, and may also be able to

investigate concerns about soil contamination

or evaluate soil physical properties such as

texture, porosity or particle size distribution.

Refer to the Ministry’s Soil Sampling factsheet

for more information on when and how to

collect a soil sample.

Contact the BCLNA for a listing of consultants

that can provide professional advice on the

suitability of the soil and the topography.

Water Source: The availability of sufficient

quantities of reliable, good quality irrigation

water is very important. Before purchasing

farm land, you should have the flow rate and

water quality of the irrigation source tested.

The water supply system should have a

minimum capacity of 40 litres per minute.

Water quality parameters to test include

dissolved solids, pH, alkalinity, and the levels

http://www.agf.gov.bc.ca/resmgmt/publist/600Series/631500-8_Nutrient_Testing_Labs.pdf

http://www.agf.gov.bc.ca/resmgmt/publist/600Series/631500-1_Soil_Sampling.pdf

of total salinity and specific salts (e.g.

calcium carbonate, sodium, and boron).

Refer to the Ministry’s factsheet titled

Irrigation Water Quality for B.C.

Greenhouses for information on factors that

affect water quality, treatment methods to

improve water quality, and on irrigation

water quality guidelines. The B.C. Trickle

Irrigation Manual also contains excellent

information on assessing water quality, flow

rates and water requirements, and design,

selection, installation and maintenance of

trickle irrigation systems. It can be

purchased from the Irrigation Industry

Association of B.C.

SITE DESIGN AND LAYOUT

The nursery site must have the facilities

required to operate the business, which will

depend on the crops produced. Will you be

a propagator? Will you grow container or

field stock, or both? Some of the facilities

and production systems that may be required

for a container operation include:

production facilities: greenhouses,

gravel or groundcloth-covered container

beds, and shade structures

water supply equipment, irrigation and

drainage systems, and a backup

electricity generator

other facilities: shipping and handling

areas, cold storage, chemical storage,

equipment repair and storage facilities,

parking, and facilities for staff

The design and layout will affect the

profitability of the nursery. The site should

be designed to allow for efficient movement

of plants and vehicles between the different

zones of production, and to allow for future

expansion. It should also be designed to

meet local bylaws and to prevent the release

of pollutants into the environment. The

Environmental Farm Planning Reference

Guide provides information on various

environmental laws and makes suggestions

for environmentally sound farm practices.

The Reference Guide is available from the

B.C. Agriculture Council.

DEVELOPING A BUSINESS PLAN

A business plan will provide information on the

crops grown, market size and potential sales,

capital costs required to set up the facility, and

an estimate of returns. It will integrate written

goals with marketing, production and financial

targets into a management strategy for the

operation. A business plan will outline what is

required to make your business successful.

The BCLNA and the B.C. Ministry of

Agriculture produced a publication titled

Preparing a Business Plan – Wholesale

Nursery Example that is designed to assist new

producers to create a business plan using a

step-by-step process. It presents four benefits

of preparing a business plan22

.

1. A business plan can improve performance

by identifying both strengths and

weaknesses of operation, and potential

problem areas.

2. It can provide a solid basis for measuring

performance.

3. It establishes a framework for making key

decisions in ongoing management and in

evaluating new opportunities.

4. The plan and the process can be used to

educate and motivate employees.”

A business plan is invaluable for

communicating information about your

business to others, such as money lending

institutions, which often require a business plan

for small business loans.

Farm Credit Corporation helps farmers to

access capital to start or expand a business.

The Corporation supports primary producers

through all three lines of their business – farm

finance, agribusiness and alliance partnerships.

For further information about these programs,

contact the Farm Credit Canada.

The Ministry of Agriculture does not provide

producers with grants to assist them to start or

expand a farm business.

22 P. Davidson. Preparing a Business Plan, A Guide for

Agricultural Producers – Wholesale Nursery Example, 1996. BC

Nursery Trades Association and the BC Ministry of Agriculture, Fisheries and Food.

http://www2.gov.bc.ca/gov/content/industry/agriculture-seafood/agricultural-land-and-environment/strengthening-farming/farm-practices-in-bc-reference-guide

http://www2.gov.bc.ca/gov/content/industry/agriculture-seafood/agricultural-land-and-environment/strengthening-farming/farm-practices-in-bc-reference-guide

CROP SELECTION

Nursery crops can be divided into eleven

distinct categories, which includes: aquatic

plants; broadleaf evergreens; coniferous

evergreens; deciduous shrubs; deciduous

trees; herbaceous perennials; native plants;

roses; tree fruits; upright evergreens; vines

and ground covers. But which crop should

the new grower produce? That is an

impossible question to answer without

experience in the sector.

There are several factors to consider when

selecting which crops to grow. Site

conditions, specific plant factors, supply and

demand, market trends and profitability

should all be analyzed to provide the

necessary information in making wise crop

selections. Also, the amount of time and

effort a new grower is willing to expend on

the crop will determine which crop is suited

to the operation.

The suitability of plant species for the soil

and climate conditions at the nursery is an

important factor23

; a successful, high quality,

healthy crop is more likely with well

adapted plants. Growing species that have

borderline hardiness for the area presents a

greater risk of crop failure and increases

production costs due to more diligent winter

protection requirements. Drought tolerant

species will reduce the need for irrigation,

however, they will not tolerate field

conditions with heavy, wet soil.

Plant factors, such as the degree of difficulty

of propagation and the crop’s susceptibility

to pests and diseases, will affect the relative

ease of growing the crop. A new grower’s

level of production expertise may determine

whether specific plant factors are a

constraint in crop selection. A sector survey

indicates that while ease of care and

growing is an important consideration for

growers, production expertise is not24

.

23 D. Ference and Associates. Profile of the BC Nursery

Industry, April 1991. BC Nursery Trades Association. 24 D. Ference and Associates. Profile of the BC Nursery Industry, April 1991. BC Nursery Trades Association.

Sector surveys indicate that established

nurseries select new crops based largely on

crop demand and market trends25, 26

. They use

past sales records, input from clients

(landscapers, landscape architects, other

growers and garden centres), and nursery visits

to determine supply and demand trends27

. The

rarity of a species is also a factor for some

growers28

. Growing new or unusual plants can

offer good profit margins because they are not

widely available. However this situation can

change quickly as more nurseries begin to

propagate the crop and, correspondingly,

increase supply. Profit margins are also

influenced by production costs, production

period, product quality, and market price.

Growers without previous experience in the

nursery sector do not have the benefit of

reviewing past sales records and production

costs. It is useful for new growers to conduct

thorough market research to determine current

and future supply and demand, and market

trends. Projections of production costs are also

an important analytical tool to determine

potential profit margins of various crops.

Market Research: Market research can be

performed by yourself or by a consultant.

Contact the BCLNA for a listing of local

consultants.

General information can be obtained from trade

journals and conversations with people in the

sector. Trade journals frequently contain

information on new plant introductions and

market trends. The December issue of

American Nurseryman is dedicated to new

plants for the coming year. Information on

such items as ornamental features, propagation

methods, pest problems, and availability are

highlighted for each woody ornamental,

perennial, and vine and aquatic plant that is

showcased.

25 D. Ference and Associates. Profile of the BC Nursery Industry, April 1991. BC Nursery Trades Association. 26 The Nursery and Landscape Industry in British Columbia,

2002. BC Landscape & Nursery Association. 27 The Nursery and Landscape Industry in British Columbia,

2002. BC Landscape & Nursery Association. 28 D. Ference and Associates. Profile of the BC Nursery Industry, April 1991. BC Nursery Trades Association.

Make an effort to attend seminars, BCLNA

meetings and trade shows. These events

provide an excellent opportunity to network

with and learn from people in the sector.

Look for and attend seminars on new plants

and on sector trends. These are common

topics at sector seminars and conferences. A

few of the trade shows and conferences that

are regularly attended by local nurseries

include: the CanWest Hort Expo in

Abbotsford; Farwest in Portland; Landscape

Ontario Congress in Toronto; Pacific

Agriculture Show & Horticulture Growers’

Short Course in Abbotsford; and The Green

Industry Show & Conference in Calgary.

Up to date information on trade shows in

Canada, the U.S. and overseas is available in

the November 1st issue of American

Nurseryman, and on the websites of

Landscape Ontario and BCLNA.

Taking regular walks through garden centres

can also provide information. You can learn

the relative sales per crop based on space

allocation, the quality and labeling that are

critical components of marketing, and the

new crops being promoted in the sector.

Garden centres and landscapers purchase

nearly 60% of the products grown by

wholesale nurseries; they know as well as

anyone which plants are in demand and in

short supply in the sector.

Keep in mind that the most popular plants

may not be the most profitable or the best to

grow for your location and soil type. They

may be in excess supply and therefore may

not offer the desired contribution margin.

Hedging cedars are a good example. There

is extremely high demand for hedging

cedars in the North American market.

However, due to annual cycles in the

volume of production and demand, prices

for the crop vary considerably between

years. Beginning in the late 1990s, the

production of hedging cedars in B.C. and

elsewhere increased significantly. Concerns

of overproduction were realized in 2005, as

the price dropped for balled hedging cedars

due to oversupply.

Also, avoid crops that are fads, especially those

that are quick to grow to market size. Base

crop selection decisions upon market trends.

Fads have short-lived periods of high returns,

followed by low prices and oversupply.

Only through experience selling nursery stock

can you truly gain an appreciation of the

complex issue of crop demand. Once you have

developed a good reputation in the sector, the

day will come when you are overwhelmed with

information from your clients on ‘what’s hot’,

which will simply setting your annual crop

production schedule.

New and Improved Plants: There is always

strong consumer demand for new and improved

plants. Nurseries and retailers can use new

plants effectively as a ‘hook’ to expand their

client base since there are often few suppliers.

For the grower of a new plant, this is an

opportunity to get a foot in the door with a new

client. The success in turning this initial

contact into a long-term client will depend

upon product quality and service, which are

covered elsewhere in this document.

A wide range of new plants are introduced each

year from individual breeders and nurseries,

botanical gardens, and government institutions.

Nursery managers know the value of new

plants and want to keep abreast of their

development. Therefore, the topic is frequently

covered in trade magazines and in conference

seminars.

In addition to new plants, consideration should

be given to growing award winning plants.

Some associations (e.g. American Hosta

Society and the Perennial Plant Association)

annually present a ‘Plant of the Year Award’.

The award winning plants often are not new to

the sector, but rather deserve recognition for

their unique qualities and proven reliability. In

the case of the Perennial Plant Association’s

‘Plant of the Year Award’, the winner is chosen

based on voting by the Association’s

membership (see Table 1).

Table 1. Winners of the Perennial Plant

Association’s ‘Plant of the Year Award’.

Year Plant

1990 Phlox stolonifera

1991 Heuchera micrantha ‘Palace Purple’

1992 Veronica ‘Sunny Border Blue’

1993 Coreopsis verticillata ‘Moonbeam’

1994 Astilbe ‘Sprite’

1995 Perovskia atriplicifolia

1996 Penstemon digitalis ‘Husker Red’

1997 Salvia ‘May Night’

1998 Echinacea purpurea ‘Magnus’

1999 Rudbeckia fulgida ‘Goldsturm’

2000 Scabiosa columbaria ‘Butterfly Blue’

2001 Calamagrostis x acutiflora ‘Karl Foerster’

2002 Phlox ‘David’

2003 Leucanthemum ‘Becky’

2004 Athyrium niponicum ‘Pictum’

2005 Helleborus x hybridus

2006 Dianthus gratianopolitanus ‘Feuerhexe’

2007 Nepeta ‘Walker’s Low’

2008 Geranium ‘Rozanne’

2009 Hakonechloa macra ‘Aureola’

2010 Baptisia australis

2011 Amsonia hubrichtii

2012 Brunnera ‘Jack Frost’

2013 Polygonatum odoratum ‘Variegatum’

2014 Panicum virgatum ‘Northwind’

2015 Geranium x cantabrigiense ‘Biokova’

Strong consumer interest in new plant

introductions and ‘Plant of the Year’

recipients is almost assured due to the

extensive promotional campaigns that

accompany their release.

It is important to do your homework when

selecting new crops. The label ‘new’ does

not always mean the plant is ‘better’. It is

very disheartening and expensive to

propagate large numbers of a new crop only

to find out there is no demand. Sector

demand for a crop can subside quickly if it

is found to be difficult to grow, has a serious

pest problem, or performs poorly in some

geographic regions. For example, the demand

for ash trees declined dramatically in 2005 due

to concern over the impact of an exotic pest,

the emerald ash borer. Since being first

detected in southeastern Michigan and

Windsor, Ontario in the summer of 2002, the

borer has killed more than five million ash

trees29

.

In addition, before propagating any plant, it is

advisable to determine if it is protected by a

patent, trademark, or is registered with the

Canadian Ornamental Plant Foundation

(COPF).

Plant Patents: In Canada, the Plant Breeders’

Rights Act was given Royal Assent in 1990.

This legislation makes it possible for breeders

to legally protect new plant varieties for up to

18 years. Thereby, providing compensation to

the breeder for the time, expertise and money

invested in the development of a new variety.

The intent of the legislation is to stimulate plant

breeding in Canada, to provide Canadian

producers better access to foreign varieties, and

to facilitate the protection of Canadian varieties

in other countries. In order to be eligible for

protection, the plant must be new, distinct,

uniform, and stable.

A species must be prescribed by regulation

before an application for plant breeders’ rights

can be made. The nursery crops currently

prescribed by regulation in Canada are apple,

begonia, blueberry, cherry, chrysanthemum,

clematis, dianthus, grapevine, impatiens,

maple, peach, pear, pelargonium geranium,

plum, potentilla, raspberry, rose, spirea,

strawberry, viburnum and yew.

Plants must be registered in each country where

protection is desired. A plant registered in

another country, but not in Canada, can be

legally propagated and sold in Canada.

However, it would be an offence to offer the

plant for sale in a country where it is registered,

if you are not licenced to do so. Lawsuits have

been filed for infringement of patents and

trademarks based on plants being offered for

29 D. Balser and D. Todd, “Emerald Ash Borer”. The Buckeye, January 2005.

sale on Internet web sites. Be very careful

when listing patented or trademarked plants

for sale on the Internet if you are not

licenced to sell the material in all countries

where the plant is protected.

Contact the Plant Breeders’ Rights Office to

apply for a plant patent, or to obtain

information on plants patented in Canada.

When a plant is awarded protection through

the Act, it is published in the Plant Variety

Journals.

Canadian Ornamental Plant Foundation

(COPF) - is a non-profit corporation

founded to facilitate the introduction of new

horticultural cultivars in Canada. The

Foundation works with growers to simplify

royalties, and will work with plant

introducers to profit from their introduction.

The main activity of the COPF is to collect

royalties on behalf of plant breeders. The

money collected is paid to the breeders on a

quarterly basis. Thereby, the Foundation

encourages plant breeding and the

development of new plants for the benefit of

the entire horticulture industry.

The Foundation annually releases a

compendium of their new ornamental plant

registrations. In 2002, the COPF released

359 new introductions from 25 different

breeders, including 10 Canadian plant

breeders. Eighty-nine of the introductions

were nursery crops (excluding annuals).

New rose cultivars accounted for 25% of the

nursery plant registrations.

Trademarks - the use of trademarks is an

increasing trend in the nursery sector. A

trademark is a way to protect the marketing

interests of a plant and is a less costly to

enforce than a patent.

The symbols TM

(or SM

) or ® are used to

designate a trademarked name. A plant’s

cultivar name and the name of a patented

plant cannot be trademarked. For instance,

the Flower Carpet® Yellow rose is protected

by a registered trademark, but its cultivar

name, Rosa var. ‘Noason’, cannot be

trademarked.

Crop Specialization versus Diversification:

You should also consider whether to produce a

specialized or diversified mix of crops. Crop

specialization has the advantages of allowing

standardization of production methods and

materials, requires a narrower range of

knowledge, and enables more specialization of

equipment and marketing. However,

specialists are more vulnerable to sudden

changes in crop demand or supply.

Most nursery stock is grown for speculative

markets. It is uncommon for a nursery to have

a written contract for a crop at the beginning of

its production cycle. Nurseries set annual

production volumes for a crop on projected

sales, which is based on long-term sales trends

and market research. The economic principles

of supply and demand are very important to

nursery operators because of the speculative

nature of nursery stock sales.

Cycles in supply are common for nursery

crops. Oversupply is the biggest concern since

it can lead to depressed prices. Oversupply is a

risk in the sector because:

it is relatively easy for new producers to

enter the marketplace since there are no

marketing boards or quotas to control the

volume of production,

there is a vast array of substitutes for any

given crop in the marketplace -

substitutions can occur between different

species (e.g. Potentilla fruticosa ‘Yellow

Gem’ for Spirea japonica ‘Little Princess’)

or varieties (e.g. Rhododendron

catawbiense ‘Boursault’ for R. ‘Roseum

Elegans’), and

nurseries often cannot quickly adjust

production levels in response to changes in

demand, since it can take up to 4 years for a

crop to reach a marketable size.

The fact that nursery managers have no control

over the two major factors determining the

annual demand for nursery crops, the economy

and the weather30

, makes the situation less

tenable.

30 M.P. Garber and K. Bondari, "Retail Garden Outlets: Business Characteristics and Factors

Downturns in the economy or poor spring

weather can reduce the ability and interest of

gardeners to purchase nursery crops. These

conditions may also result in shifts in

consumer buying patterns. For instance,

consumers may prefer to purchase lower

priced plants, such as bedding plants over

trees and shrubs. This will reduce the total

value of plant sales, but may actually

increase the demand of specific plants.

One way to provide some protection against

changes in crop demand and supply is to

diversify the range of crops produced and

the markets targeted.

The Type and Size of Stock to Produce:

The size of stock produced and the type of

production system used must also be

considered. Will you grow liners or larger

stock sizes? Will you grow in containers or

in the field? Answers to these questions will

be based on many factors, including

individual skills, the type of equipment

already possessed by the farm, the size of

the farm, the type and quality of the soil

resource, and personal interest.

Virtually all nursery stock is started as

liners. A liner is a small plant that is usually

transplanted into a #1 (one gallon) container

or into field soil for growing-on, to produce

a larger plant that is better suited for retail or

landscape sales. Some nurseries specialize

in the production of liners. The crop may be

sold to retailers and landscapers, but the

major market is other growers. Even though

the majority of nurseries do in-house

propagation, this production does not

usually meet their needs. Based on a 2002

sector survey31

, in-house production of

liners supplies on average 58.5% of a

nursery’s needs. Therefore, nurseries rely

on other suppliers to satisfy their liner

requirements.

31 The Nursery and Landscape Industry in British Columbia, 2002. BC Landscape & Nursery Association.

Figure 5. Container-grown ‘Rheingold’ cedars in a

poly-covered hoop house.

Figure 6. Outdoor, field-grown nursery stock.

There are many reasons for purchasing liners

from other growers, such as:

it is more cost effective because production

costs for specialty propagators are lower

due to economies of scale and greater

automation,

to compensate for in-house crop failures,

the nursery has poor success propagating

the crop,

the crop is very new to the market and the

nursery has not established sufficient stock

plants to propagate the quantity they need,

propagation requires specialized skills and

equipment, which some nurseries do not

possess and do not want to invest in, and

the crop can only be propagated by

specialized methods, such as grafting,

budding, or tissue culture.

Traditionally, nursery production was all soil-

based, either being harvested bareroot or with a

ball of soil that is usually wrapped in burlap

and tied. This latter stock is referred to as

balled & burlapped or B&B. However, roughly

60% of all nursery plants sold in the U.S.

were container-grown in 199932

. The sector

trend is towards more container production,

at the expense of field production. Some

reasons for the shift towards container

production are:

the high cost of land in B.C.,

returns per hectare can be more than 15-

fold greater for container versus field

production,

customers prefer container stock due to

its uniformity, ease of handling, and

improved establishment,

greater opportunity for mechanization;

mechanization is required for large-scale

production to be competitive,

the ability to harvest and transplant

stock during most of the year,

plant harvesting is not affected as much

by poor weather,

it results in accelerated crop growth, and

it does not directly lead to soil erosion.

There is a tremendous range in container

sizes used by the sector. Containers range

from liners (e.g. multiple-celled plug trays

and 7 to 15-cm pots) to large pots (1 to 5

gallon) and tubs (7 to 25 gallon). The B.C.

nursery sector has adopted the nursery stock

container classes of the American National

Standards Institute (ANSI Z60.1-1996).

This system defines container classes based

on minimum and maximum volumes. For

instance, a #1 pot must have a volume of 2.5

to 4.1 litres33

. The container standards are

listed in the B.C. Landscape Standard that

can be obtained from the BCLNA.

Growers that sell container stock to U.S.

retailers need to be aware of U.S. labeling

requirements. In 2005, U.S. regulators

notified the retail sector that container stock

must comply with the Uniform Weights and

Measures Law and the Uniform Packaging

32 “News Watch. Horticultural Research Institute Funds

Development of Mechanized Container-Handling System”. American Nurseryman, January 15, 1999, page 10. 33 BC Landscape Standard, 2001 (6th edition). Published by

the BC Society of Landscape Architects and the BC Nursery Trades Association.

and Labeling Regulations. The intent is to

provide accurate labeling to assist consumers to

compare similar products. If a plant is sold in a

1-gallon pot, the container must have a volume

of 1-gallon. This legislation requires that three

kinds of information be easily accessible to the

consumer, either on signage or on the container

label, including:

a declaration of identity - the common or

botanical name of the plant,

a declaration of net contents - must

describe the contents by weight, measure

(container volume) or count, and the

quantity declaration must be presented in

Imperial and metric measure, and

a declaration of responsibility – the name

of the business that grew, brokered or

retailed the item.

Figure 7. Digging a field-grown tree with a tree

spade.

Figure 8. The root ball is wrapped in burlap and

secured with a wire basket.

Relative to field production, container

production has several disadvantages. First,

it has higher capital investment. Building

and machinery replacement costs are 3-fold

higher for container versus field production,

and the difference is even greater if the

container operation has a propagation

greenhouse or pot-in-pot beds. Second, it

requires a higher level of management due

to the greater dependence on supplemental

irrigation and nutrition. Third, the grower

must deal with the problem of wind-throw

of containers. Fourth, there is a greater

threat of root damage as a result of root

exposure to extreme temperatures.

The impact of soil removal on land

productivity should not be ignored if you

choose to produce balled stock.

Soil consists of several distinct layers (refer

to Figure 9), including the A horizon, and

the underlying B and C horizons. The A

horizon or topsoil contains large quantities

of organic matter and plant nutrients,

relative to the B and C horizons.

Organic matter consists of plant and animal

tissues in varying stages of decomposition.

Soil organic matter has an important role in

soil productivity. It improves soil structure,

aeration, water penetration, and moisture-

holding capacity, and it is largely

responsible for nutrient availability in the

soil. Removal of soil from the A horizon,

which occurs when balled stock is dug,

results in a reduction in the soil organic

matter content and, thereby, reduces soil

productivity. About 470 tons of soil per

acre, or 7 cm in 5 years, is removed with the

harvest of trees with a 100 cm root ball34

.

The addition of compost or manure, and the

use of cover crops are recommended to

encourage the development of fertile and

deep topsoil. This will result in a greater

proportion of the soil removed at tree

harvest consisting of added materials,

thereby reducing the loss of native soil.

34 Davidson, H., Mecklenburg, R. and Peterson, C. 1988.

Nursery Management Administration and Culture. Prentice Hall, NJ.

Other management practices recommended to

reduce soil loss are presented in the Ministry’s

Environmental Farm Plan Reference Guide.

Figure 9. A soil profile35

showing the LFH layer,

which contains non-decomposed and partially

decomposed litter, and the A, B, and C horizons.

The A horizon is the first layer of true mineral soil

and the topsoil layer, the B horizon is the subsoil,

and the C horizon represents the soil parent

material.

A new container system that has been adopted

by several nurseries in B.C. is the pot-in-pot

system. This system incorporates a typical

nursery container that is placed within a plastic

liner embedded in the soil. If poor soil

drainage does not permit the use of the in-

ground system, a system has been developed

for use above ground.

The pot-in-pot system is an alternative to field

production for larger nursery stock. The

system incorporates the benefits of container

systems and eliminates some of the

disadvantages. The pot-in-pot system

eliminates wind-throw of containers and heat-

induced root damage during the summer, and

reduces winter damage to the root system. The

biggest drawbacks of the system are the cost

and preventing root growth out of the drain

holes and into the native soil. Pot-in-pot

production may not be practical in the wet

coastal areas because of drainage problems.

The BCLNA’s Buyers Guide provides

information on the types of plants grown in the

field and the approximate volumes of

35

Environmental Guidelines for the Nursery & Turf Industry in

British Columbia, 1994. Published by the BC Ministry of Agriculture, Fisheries and Food.

production. The Buyers Guide is also an

excellent resource to identify suppliers of

specific types of nursery stock.

Figure 10. The pot-in-pot crop can be easily

removed from the liner pot that is embedded in

the soil.

Comparison of Relative Production Costs of

Different Stock Types: Table 2 lists the

relative direct expenses for three representative

crop sizes, including liners, #1 containers, and

balled stock. There are major differences in the

proportion of direct expenses attributed to crop

supplies and labour, with liner crops requiring

significantly higher labour and less crop

supplies, relative to #1 containers and balled

stock. Labour requirements will depend largely

on the efficiency of the nursery layout and on

the adoption of mechanization.

Table 2. Comparison of Direct Expenses Incurred with Liner, Container, and Field-Grown Deciduous

Stock.

Direct Expense 6 cm Liner

Deciduous Shrub36

#1

Deciduous Shrub37

Field-Grown

Deciduous Tree38

Crop Supplies (liners, soilless

media, fertilizer, pesticides,

pots and plant tags)

29% 81.4% 69.5%

Utilities / Fuel 13% 0.2% 6.3%

Repairs & Maintenance 4% 0.2% 3%

Labour (propagation, potting,

pest control, grading and

loading, field preparation)

44% 15.2% 19.2%

Marketing 10% 3% 2%

36 BCMAF, "Deciduous Shrub Liner Production Fraser Valley." Planning For Profit, Fall 1996. 37 BCMAF, "One Gallon Deciduous Shrub Containers Fraser Valley." Planning For Profit, Fall 1996. 38 BCMAF, "Field Grown Deciduous Trees." Planning For Profit, Spring 1993.

For many new growers, the scale of your

operation will not justify purchasing the

latest mechanized equipment nor, in some

cases, even basic mechanized systems. For

instance, a sector survey found that small

growers (sales of $100,000 to $300,000) do

not have automated potting equipment39

. In

contrast, 16.8% of medium-sized growers

(sales of $300,000 to $1 million) and 43.9%

of large growers (sales in excess of $1

million) do have automated potting

machines40

. Without automated systems,

costs of production can be expected to be

higher for a new nursery relative to an

established, larger nursery.

A shortage of skilled labour in some of the

major nursery producing regions is driving

the development and adoption of

mechanization. One exciting area of

mechanization is the development of

robotics systems. In the future, there will be

greater use of automated systems in the

nursery sector. This will reduce production

costs, but will increase capital costs.

There are also differences in the returns and

capital costs. Liner crops have higher

returns per unit area, higher costs for

buildings and machinery, and lower land

requirements, relative to #1 pots and field-

grown caliper stock. The major capital cost

with liner production is the propagation

greenhouse, whereas for container and field-

grown stock it is tractors and associated

equipment.

A 2002 sector survey of nursery growers,

conducted by the BCLNA, concluded that

“operations with 80% or more acres in field

production return median sale of about

$9,000 per acre [per year]. Operations with

80% or more acres in container and/or

greenhouse/polyhouse production return

median sales of about $140,000 per acre.

Operations with no field production at all

39 The Nursery and Landscape Industry in British Columbia.

2002. BC Landscape & Nursery Association. 40 The Nursery and Landscape Industry in British Columbia. 2002. BC Landscape & Nursery Association.

return median sales of about $155,000 per

acre.”41

Figure 11. Automated pruner for use with a rolling

table system.

Figure 12. Retractable roof greenhouses are very

versatile; automation enables variable shade control

and excellent ventilation.

Method of Propagation: There are many

different propagation methods to produce

nursery crops. The method used depends on

the nursery’s propagation skills and which

method is most cost effective for the crop.

Most nursery crops are produced from seeds,

cuttings or divisions. Production from seeds is

generally the least expensive method but the

plants produced are not generally identical to

their parents. Thus, seed propagation is not

suitable for most cultivars.

41 The Nursery and Landscape Industry in British Columbia, 2002. BC Landscape & Nursery Association.

In order to maintain the unique

characteristics of a cultivar, it is necessary to

use an asexual method of propagation.

Rooting of cuttings and plant division are

common asexual methods. Grafting (Figure

13), budding, and tissue culture techniques

are also important methods. However, their

use is limited because they are labour-

intensive and require very specialized skills

and equipment. Grafting, budding and

tissue culture methods are usually reserved

for high value crops that cannot be

efficiently propagated from seeds or

cuttings.

Figure 13. Whip grafted maple liners.

Some nursery catalogues list the method of

propagation used for each crop. This can be

very useful information for the new grower.

For example, the wholesale catalogue from

Monrovia Nursery does provide this type of

information.

To work out a propagation protocol for a

particular crop requires research and

personal experience. There is considerable

information available in books, trade

magazines and scientific journals. The best

advice is to keep detailed records so that you

can repeat procedures that are successful.

The International Plant Propagators’ Society

is an excellent resource for information,

either through the proceedings from their

annual meetings or from discussions with

members at Society events. The motto of

the Society is To Seek and To Share and

members truly do openly share information

with members.

When propagating plant material it is

important to be aware of any trademarks or

patents that may be registered on the particular

variety or cultivar being propagated. For more

information on these subjects refer to the

section titled Plant Patents.

Suppliers of Planting Stock: Once decisions

have been made on the crops to produce, the

next question often is where to purchase stock

plants. The BCLNA’s Buyers Guide is an

excellent source to identify suppliers. It lists

the volumes, sizes and types of crops grown at

member nurseries. The Buyers Guide is

available from the BCLNA and there is an

online version.

If you are purchasing stock plants for in-house

asexual propagation, it is critical to ensure you

are buying material that is true-to-name. It is

also important to ensure the material is free of

regulated pests. If a regulated pest is detected

at your nursery, then the Canadian Food

Inspection Agency (CFIA) will take steps to

eradicate it. These actions can include

prohibitions on plant movement and

destruction of affected stock, which can result

in lost market opportunities and serious

financial hardship. The threat posed by

regulated pests is very real and has been

referred to as the single greatest external threat

to the sector.

In the past decade, several exotic pests (e.g.

Phytophthora ramorum, Asian Longhorned

Beetle and Emerald Ash Borer) have been

detected in North America and have had a very

negative impact on the ornamental sector. The

finding of Ralstonia solanacearum, Race 3

(Biovar 2) in the U.S. in 2003 resulted in more

than 800 greenhouses being quarantined and

financial losses for the sector estimated at

more than $4 million. The detection of the

pathogen in some greenhouses resulted in the

entire geranium crop being destroyed, with no

immediate financial compensation. In 2004,

the detection of the quarantine pathogen,

Phytophthora ramorum, at a few facilities in

B.C. resulted in the destruction of over a

$500,000 worth of plants, and in excess of

$2.2 million in total costs for crop

destruction and lost business.

Figure 14. Restricted access, signage and foot

dips are components of nursery biosecurity.

Due to concerns of spreading Phytophthora

ramorum, the organism that causes Sudden

Oak Death or Ramorum Blight, the B.C.

nursery sector implemented a voluntary P.

ramorum certification program in 2004.

The program is now part of the national

Clean Plants program, which is managed by

the Canadian Nursery Certification Institute.

The program includes nursery sampling and

testing for P. ramorum, and the

implementation of biosecurity, record

keeping and audit procedures. The program

was developed to provide growers with a

method of assuring themselves, their clients,

the public and Canada’s trading partners that

B.C. is not producing or selling P. ramorum

infected plants. Providing a P. ramorum

certification program was crucial to

maintain access to the Canadian and US

markets. The situation is continually

changing and you are advised to check with

the CFIA or the Canadian Landscape and

Nursery Association for the latest

requirements for wholesale nurseries.

Growers need to understand the risk associated

with importing plant material and take

effective action to minimize the risks.

Although producers should expect clean stock

from suppliers, in reality this is not always

true. Producers need to implement procedures

to detect pests on incoming stock and reduce

the risk of spreading the pest to other crops at

their operation. Some steps that can be taken

to protect your nursery include:

1. Know Your Suppliers - Are they in or

near an area that is regulated for a pest of

concern? Where do they source their

stock? What steps do they take to ensure

their stock is clean?

2. Isolate Crops at the Facility - New

shipments, especially from high risk areas

or of high risk crops, should be isolated in

a ‘quarantine’ area and regularly

monitored for pests.

3. Quick Detection and Action of

Unknown Pests - Monitor crops regularly,

especially new stock. Be aware of

regulated pests, and their symptoms and

signs. Information on some of the exotic

pests of concern to nursery growers are

described in Chapter 1 of the Nursery

Production Guide. Immediately contact

local agencies for assistance to identify a

‘new’ pest or disorder.

4. Sanitation - Off-load plant shipments at a

location that can be easily cleaned; bag

and discard all debris. Grow potted crops

on a free-draining surface to prevent

puddles and splashing. Take steps to

reduce the risk of spreading pests between

production areas on staff and equipment.

5. Maintain Accurate Records on Crop

Movements - Crop movement records are

required for trace-out investigations. Keep

records on the product, amount, date, and

the origin and/or receiver of the plants.

BUSINESS REGISTRATION AND

LICENCING

Once the decision has been made to

undertake a nursery business venture, one of

the first details to address is what type of

business structure to operate under. “From a

legal point of view, there are three common

types of businesses: sole proprietorship,

partnership and corporation. Each has

different and important implications for

liability, taxation and succession.”42

For a

discussion on the advantages and

disadvantages of each refer to the Small

Business B.C. Education Centre website. It

is advisable to consult a lawyer and/or

accountant to determine which business

structure is most suitable and to help set up

the business.

Contact your local Government Agent

Office or the provincial Corporate Registry

for information on how and where to

register or incorporate a business in your

area.

A municipal business license may be

required for each location that the business

occupies, depending on whether the business

sells at the wholesale or retail level, and

whether the products are grown on site or

shipped in from elsewhere. A business

license may also be required for each

municipality in which the business makes

sales. Business license requirements may

vary between municipalities, check with the

city hall licensing department of the

municipalities involved.

There is considerable information on the

Internet that will be useful when setting up

your business. The Canada / British

Columbia Business Services Society’s

website has resources for new business

entrepreneurs. The business start-up section

has information on business registering and

licensing requirements, land use and zoning,

labour requirements, and keeping business

records. The site also has an interactive

42

Online Small Business Workshop.

business planner, small business guides, e-

business information and numerous links to

useful government sites.

The One Stop Business Services site is an

excellent source for details on starting a new

business, and business registration and

licensing. Once you have your business

registered provincially, enter the one stop

business registration service to register for the

other government registrations you need:

GST, PST, Canada Revenue Agency,

WorkSafeBC coverage, and municipal license.

You must complete a company name search

before you can apply for these government

registrations.

One Stop Business Service Centres are located

throughout the province, see their website for

office locations.

INSURANCE COVERAGE

Insurance coverage beyond WorkSafeBC is

another area to consider. Private insurers can

provide customized insurance plans to meet

your needs. The plan may include farm,

greenhouse, liability, life and other types of

insurance coverage.

Weather can damage a crop or make it

unmarketable. Insurance against weather-

related crop loss is provided by the

government-run Production Insurance program

in B.C. At this time, the program does not

provide coverage for any nursery crops.

The Canadian Agricultural Income

Stabilization (CAIS) Program is a joint

federal/provincial/territorial business risk

management program that provides disaster

protection. CAIS helps producers to protect

their farming operations from both small and

large drops in income. A farm will receive a

payment from CAIS when their current year

farm income is less than their average farm

income from previous years. The amount of

support received is based on the level of

protection chosen. The program is a whole-

farm program available to eligible farmers

regardless of the commodities they produce.

ROLES OF SECTOR

ASSOCIATIONS

There is a network of agricultural sector

associations which provide various forms of

representation for the B.C. nursery sector.

The following list progresses from the local

grassroots level through to the national

organizations.

Landscape and Nursery Only:

B.C. Landscape & Nursery Association

(BCLNA) - The BCLNA has more than 600

members, representing three commodities:

wholesale nursery, retail nursery/garden

centre; and landscape professionals. It also

includes as members the sector’s educators,

suppliers, consultants and affiliated

government agencies.

The organization was formed in 1953 and is

today a strong organization, providing a

forum for companies with shared interests

and concerns to work together on local,

regional and provincial issues. Individual

companies may contact the BCLNA for a

listing of membership services and benefits.

Canadian Nursery Landscape Association

(CNLA): Individual companies can join the

CNLA only by becoming a member of a

provincial nursery association, such as the

BCLNA. The CNLA, which counts as

members all the provincial associations,

represents the nursery sector on all national

issues. It also provides a wide range of

membership benefits.

Pan-Horticulture:

Canadian Horticulture Council: The

nursery sector is represented in this national

organization through the CNLA. Representing

a cross-section of Canadian horticultural

organizations, it includes in its membership

individual provincial organizations as well as

umbrella groups like CNLA.

Pan-Agriculture:

B.C. Agriculture Council (BCAC): The

BCAC is the provincial “umbrella”

organization for agriculture. Individual farm

organizations (like the BCLNA) are members

through their association. Its objective is to

provide an efficient and effective voice for

those issues which impact on all of B.C.

agriculture.

Canadian Federation of Agriculture: This

organization, like the CHC, includes both

individual and umbrella groups from across

Canada. It provides a voice for pan-Canadian

agricultural issues.

APPENDIX 1 - Regulations

There are numerous municipal, federal, and

provincial acts and bylaws that regulate

what you can do on your farm. Below is

some information on a few regulations that

should be considered when setting up a

nursery. This is not an all-inclusive listing.

FEDERAL REGULATIONS

Customs Act: The Act governs the

importation and exportation of goods in

and out of Canada. The Act also

regulates the transportation, movement

and storage of goods. A certificate of

origin is required for all goods being

imported into Canada and goods being

exported to the U.S. For detailed

information on the required

documentation for import and export

shipments, visit the importsource.ca or

exportsource.ca website.

Excise Tax Act (GST): Legislates taxes

payable on goods and services sold

within Canada (Goods and Services

Tax). Individuals or businesses

operating in Canada with worldwide

annual revenues from taxable supplies of

goods and services over $30,000 are

required to register for GST with the

Canada Revenue Agency (CRA), and

collect and remit GST on sales made

within Canada. Registration is voluntary

for business with annual revenue below

$30,000 but may be beneficial in order to

receive input tax credits on business

purchases made.

Fisheries Act: The Fisheries Act is federal

legislation established to protect

Canada’s fisheries resources and

supporting habitats. It applies to all

Canadian waters, including ditches,

streams, marshes, rivers, lakes, estuaries,

coastal waters and marine offshore areas.

The Act also applies to seasonally wetted

fish habitat such as shorelines, stream

banks, flood plains, intermittent

tributaries and privately owned land.

The habitat protection provisions of the

Fisheries Act are of particular interest to

farmers. These sections prescribe that no

one may carry out work or undertaking that

results in a harmful alteration, disruption or

destruction of fish habitat, unless it has

been authorized by Department of Fisheries

and Oceans (DFO). The Act also prohibits

the deposit of harmful substances into

waters containing fish, such as fertilizers,

pesticides, manure, sediment, etc.

Farmers should contact DFO before

working in any watercourse to help

determine the requirements that may apply

to a specific project.

Migratory Birds Convention Act: This Act is

designed to protect migratory birds that

inhabit Canada during part or all of the

year. There are provisions in the Act

covering when and where birds may not be

killed or captured or their nests or eggs

disturbed. Although migratory birds may

damage agricultural lands, it is an offence

under the Act to release substances which

may harm them.

Pest Control Products Act: The intent of the

Act is to ensure the safety, merit and value

of pest control products used in Canada. It

focuses on the protection of human health

and the environment, and product

performance.

Under the Act, a control product is defined

as any product, device, organism or

substance that is manufactured,

represented, sold or used to control,

prevent, destroy, mitigate, repel or attract

pests. The term pest includes any injurious,

noxious or troublesome insect, fungus,

bacterial organism, virus, weed, rodent or

other plant or animal pest. Products

regulated under the Act include herbicides,

fungicides, insecticides, biological agents

such as bacteria and viruses, antimicrobial

agents, growth regulators, wood

preservatives and water purification

products.

All pest control products used or

imported into Canada must be registered

in Canada.

Plant Breeders’ Rights Act: Governs the

rights to propagate, or sell for the

purpose of propagation, new varieties

and cultivars of plant material that have

been registered with the Plant Breeders’

Rights Office, for a period of up to18

years. For specific information on which

cultivars or varieties are protected by the

Act contact the Canadian Ornamental

Plant Foundation.

Plant Protection Act: The purpose of this

Act is to protect plant life and the

agriculture and forestry industries by

preventing the importation, exportation

and spread of injurious pests, and by

providing for their control and

eradication as well as the certification of

plants and other things.

Regulations under the Act restrict the

movement of plant material worldwide.

There are also provincial acts that

regulate the movement of nursery stock

to prevent the spread of pests. The

Nursery Production Guide provides

information on plants that have

movement restrictions due to the

provincial and federal regulations.

Contact the Canadian Food Inspection

Agency (CFIA) for information on

movement restrictions and phytosanitary

requirements of nursery stock.

Domestic Shipments - Some areas in

Canada are classified as a ‘regulated

region’, due to the presence of a

regulated pest. Nursery stock to be

shipped from a regulated to a non-

regulated area requires a domestic

movement certificate. A certificate is

issued based on an inspection of the

stock by the CFIA. For some regulated

pests, there are specific management

practices that must be implemented for

stock to qualify for a movement

certificate.

Export Shipments - A phytosanitary

certificate from the CFIA is required for all

export shipments. This document is an

assurance that the plants are free of

quarantine pests and substantially free of

other pests. Export certification is a

quarantine requirement of importing

countries.

Import Shipments - An import permit is

required to import nursery stock into

Canada from any country, with the

exception of the continental U.S. An

import permit is required for nursery stock

from the continental U.S. only where there

are specific quarantine regulations

governing their movement. Permits are

often issued for a three year period. Permit

application forms are available from the

CFIA. A phytosanitary certificate issued

by the exporting country is required in most

cases, as described above.

The Act also provides for the monitoring of

pests. It obligates anyone discovering a

pest, in an area where the pest has not

previously been known to exist, to notify

Agriculture and Agri-Food Canada

immediately and provide a specimen for

identification.

PROVINCIAL REGULATIONS

Assessment Act: B.C. Assessment is

responsible for classifying and determining

the market value of all properties in B.C.

This information is used by taxing

authorities to set property taxes.

Property taxes are usually based on market

value. However, the value of farm land

(Class 9 land) is based on agricultural

productivity of the land. Land productivity

is calculated from a commissioner rate

formula. Based on this formula, the

maximum value of ‘farm class’ land is

about $10,000/ha, which is well below the

market value. Therefore, the farm land

classification significantly reduces the

property taxes assessed.

To be classified as farm land, the property

must produce primary agricultural products

for sale such as a crop or livestock.

Classification of farm status of an

operation is made by the B.C.

Assessment on the basis of land area and

annual gross income from primary

production.

Commercial Transport Act: Covers the

registration, licensing and operation of

commercial vehicles. Its goal is to ensure

public safety. Provisions under the Act

cover vehicle and load size, weight,

projections and overhangs. Under the

Act, the police and appointed inspectors

can prohibit the operation of any vehicle

they feel is unsafe.

Drainage, Ditch and Dike Act: Establishes

a system for the regulation and

authorization of ditches, watercourses,

drainages, and dikes throughout the

province.

Drinking Water Protection Act: Prohibits

contaminating drinking water by

introducing or causing anything to be

introduced into a domestic water system,

a drinking water source, a well recharge

zone or an area adjacent to a drinking

water source.

Electrical Safety Act: Outlines the duties

and responsibilities of owners and

occupiers of structures in which

electrical equipment is used. It also

outlines what is required of contractors

and employees designing, installing,

testing and using electrical equipment.

Employment Standards Act: Governs

payment of wages, hours of work,

breaks, and termination of employees,

and employers’ record keeping

obligations. A guide to the Employment

Standards Act is available from the

Ministry of Jobs, Tourism and Skills

Training.

Environmental Management Act: The Act

is responsible for controlling pollution in

B.C. The Act defines pollution as “the

presence in the environment of

substances or contaminants that

substantially alter or impair the usefulness

of the environment.” Under the Act,

agricultural waste must not be directly

discharged into a watercourse or ground

water. Regulations in the Act also address

specific issues including agricultural waste

control, open burning smoke control,

compost production and use, petroleum

storage, chemical waste control, and spill

reporting.

If agricultural wastes are handled on the

farm in accordance with the Code of

Agricultural Practice of Waste

Management, then the operation is exempt

from holding a waste management permit.

The Environmental Farm Plan Reference

Guide supports the Code, and provides the

sector with various options for managing

farms in an environmentally sound manner,

without contravening Federal or Provincial

environmental laws or regulations.

Farm Practices Protection (Right to Farm)

Act: The fundamental policy of the Act is

that farmers have a right to farm in B.C.,

particularly in the Agricultural Land

Reserve, provided they use ‘normal farm

practices’ and follow other legislation listed

in the Act. The Act stipulates that farm

operations must abide by regulations in the

Health Act, Pesticide Control Act and

Waste Management Act.

The Act also amends the Municipal Act and

Land Title Act to encourage local

governments to support farming by

ensuring local bylaws reflect provincial

standards for farming.

The Act also establishes an improved

complaint resolution process for people

who live near farms and have concerns

about farm practices which create dust,

odour, noise or other disturbances.

Fish Protection Act: Fish and fish habitat are

protected by rules established in relation to

water licenses on “sensitive streams” where

the sustainability of fish habitat is at risk.

The Act allows the provincial government

to establish directives for local

governments in preserving streamside

areas from residential, commercial and

industrial development.

Health Act: Safeguarding the health of

British Columbians is the focus of this

Act. The Act regulates farm practices

that may result in a health hazard. Such

hazards can occur when nutrients,

contaminants or pathogens are

discharged into or on to land, water or

air. Refuse, unpurified sewage, and other

substances may not be discharged to the

environment.

Specific regulations cover removal of

health hazards, sanitation standards in

public buildings, ventilation, sewage

handling, and water and food safety.

Agritourism and destination nursery

businesses also need to consider the

Act’s regulations concerning food

service facilities that may be part of the

operation.

Highway Act: The purposes of this Act are

to ensure travel on highways is safe and

to protect B.C.’s transportation

infrastructure. Under the Act, it is an

offence to place or leave any material on

public roads. This includes offensive

substances (such as mud or manure),

containers, and other debris.

Signs and mail boxes cannot be erected

without a permit from the B.C. Ministry

of Transportation and Infrastructure. To

obtain a sign, a roadside vendor must

provide safe access and sufficient

parking. Lights which distract motorists

are forbidden.

Ditches, culverts or flumes cannot be

changed or installed without permission.

The ministry may impose load

restrictions limiting the size and weight

of agricultural vehicles on certain roads.

Motor Vehicle Act: The purpose of the Act

is to protect people traveling on public

roads. Specific provisions cover the

movement of farm equipment on public

roads. Farmers may drive, propel, draw

and move implements of husbandry on

certain roads. They may also carry farm

products, supplies, stock, fertilizer, seed

and tools in trailers. Slow moving vehicles

may not impede other traffic.

The Act regulates the distance at which

signs can be erected from highways in rural

areas of B.C., as well as light emissions and

reflections which may affect visibility on

the highway. Other provisions cover the

parking of vehicles along highways and the

use of vehicles along highways to sell

produce.

Specific regulations cover the location of

cattle guards, fences and gates.

Under the Act it is an offence to dump or

deposit any “noisome, nauseous or

offensive matter” on a highway or right-of-

way.

Integrated Pest Management Act: This Act

establishes a regulatory regime for the

control of pesticides. The Ministry of

Environment is responsible to license and

certify sales, purchases and the use of

pesticides in the Province. The Act also

regulates storage, disposition and

transportation of pesticides. Applicators

and sellers of pesticides are required to

undergo training and certification. To

obtain a certificate you must pass the

provincial Pesticide Applicator Exam.

Courses are offered at some community

colleges to prepare applicants for the exam,

and study kits including reading material

and videos are available for learning the

exam material.

Plant Protection Act: The Act provides for

the prevention of the spread of pests

destructive to plants in B.C. It gives

inspectors the power to enforce provisions

in the Act, including the establishment of

quarantine areas. This Act is the provincial

counterpart to the federal Plant Protection

Act. The B.C. Plant Protection Advisory

Council helps enforce the Act by advising

provincial and federal officials of potential

insect, plant disease, weed and other

hazards.

Safety Standards Act: The purpose of this

Act is to ensure boiler and pressure

vessel safety in British Columbia. The

Act outlines the responsibilities of boiler,

pressure vessel and refrigeration

equipment owners and qualifications

needed by personnel operating it.

Specific regulations cover the design,

construction, installation, inspection,

operation, condition, alteration

maintenance, transportation, repair,

testing, sale and exchange of boilers,

pressure vessels, pressure piping, fittings

and refrigeration equipment.

Social Services Tax Act: Social Services

Tax, or PST, is applicable to most

products sold in the province of B.C.

Any business selling taxable goods at

retail is required to register as a vendor

with the Consumer Taxation Branch,

Ministry of Finance, and collect and

remit social service tax (retail sales tax)

on taxable sales.

In B.C., bona fide farmers are exempt

from paying social services tax on certain

purchases intended for farm use. Tax

exemptions include supplies, such as

fertilizer, growing medium and fuel, and

purchases of capital assets such as tree

diggers and irrigation equipment.

Coloured fuel and propane may be

purchased PST exempt for vehicles used

entirely for farm business use. A Family

Farm Truck Emblem may be obtained to

purchase PST exempt fuel for vehicles

that are used for farm and restricted

personal use.

To claim farmers’ provincial sales tax

exemption, farm businesses must obtain

a B.C. Farm Identity Card which

identifies them as a bona fide farmer. A

"bona fide farmer" means a person who

holds or leases land classified as farm

land under the provisions of the

Assessment Act of B.C. Once bona fide

farmer status has been established, a

refund may also be obtained for tax paid

on applicable farm purchases for the

previous two years.

All bona fide B.C. farmers are eligible for

the B.C. Farmer Identity Card. For details

on how to obtain a B.C. Farmer Identity

Card, contact the B.C. Agriculture Council.

Soil Conservation Act: The Act is intended to

protect soil on land in the Agricultural Land

Reserve by regulating its removal and the

placement of fill. Removal or deposit of fill

on land requires the approval of the local

government authority and a permit from the

Agricultural Land Commission. The

Commission sets terms and conditions on

the quantities of earth involved, how the

work is to be undertaken, and the

restoration required to return the land to a

condition fit and suitable for agriculture.

Transport of Dangerous Goods Act:

Establishes requirements to provide for the

safe transport of goods deemed to be

dangerous. Under the Act, all safety

requirements must be met and all

dangerous goods and vehicles transporting

dangerous goods must be appropriately

marked. Regulations specify which

substances and organisms are dangerous

and establish classes of dangerous goods.

They are: (1) explosives, (2) gasses, (3)

flammable and combustible liquids, (4)

flammable solids, (5) oxidizing substances,

(6) poisonous and infectious substances, (7)

radioactive materials, (8) corrosives, and

(9) miscellaneous products, substances or

organisms dangerous to life, health,

property or the environment.

Weed Control Act: The purpose of the Act is

to protect our natural resources and sector

from the negative impacts of noxious

weeds. It is an offense under the Act to sell

nursery stock that contains a noxious weed,

or a propagative part of a noxious weed.

Worker’s Compensation Act: The Industrial

Health & Safety Regulations cover a broad

range of issues regarding worker safety. A

requirement of the regulations is the

implementation of an industrial health and

safety program at the workplace.

Four sets of health and safety regulations

cover B.C. companies, large and small:

a) Occupational Health and Safety

Regulations establish minimum

health and safety requirements.

b) Occupational First Aid Regulations

outline the first aid services and

equipment employers must provide.

c) Workplace Hazardous Materials

Information System regulations

cover hazardous substances and the

information that must be provided.

d) Occupational Environment

Regulations cover work conditions

such as illumination, atmospheric

contaminants and ventilation in

factories, shops and offices.

Registration is required for all employers

and a premium is payable based on

wages and an assessed rate to provide

WCB insurance coverage for workers.

Individuals operating as a proprietorship

are not required to register with WCB

but may opt for the Optional Personal

Protection.

The Farm and Ranch Safety and Health

Association (FARSHA) assists producers

to follow B.C.’s Occupational Health and

Safety Regulations for Agriculture.

FARSHA is a non-profit organization

that is dedicated to reduce the incidence

of injuries and accidents on B.C. farms

and ranches. They also provide resource

materials, presentations, assistance in

establishing safety committees, and on-

site health and safety reviews.

Water Act: This Act creates a system for

the regulation of the Province’s fresh

water systems. A license must be

obtained before using, storing or

diverting surface water or making

changes in or about a stream.

MUNICIPAL REGULATIONS

Municipalities have bylaws to deal with

greenhouse site coverage, building codes,

woodwaste deposition, storm water

management plans, boiler emissions, and

setbacks from property lines and water

courses.

Municipalities also have zoning bylaws that

restrict the type of development permitted

on a parcel of land. While checking on the

zoning of property you are interested in

purchasing, inquire about future municipal

plans for the area. Plans for large roadways

or subdivisions may already be in the

works.

Contact the municipal government for more

specific information on bylaws that will

pertain to your nursery.

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